oil is having its best day in three years. what has investors shaking off fierce? >> a decade since hurricane katrina devastated new orleans. how they have recovered economically since the catastrophe. leadership shake off which could leave marchione in the drivers seat. ♪ mark: good day from bloomberg world cut -- world headquarters in new york. i am here with olivia sterns. olivia: i'm in the passenger seat. a quick look at the markets. rally again today under way. the dow is now on track to poses

biggest two-day gains since 2008. nasdaq and the s&p also on track, their biggest today games since 2009. a lot of this is on the back of the better than expected reading of second-quarter gdp. the revised numbers showing the economy grew at 3.7% in the second quarter, better than even the top estimate. you're also seeing the move playing out on a treasury market. you can see treasuries are rallying, a turnaround. two point 16%, we started off a week below 2%. the story today might have to be oil. look at the huge surge. i do not think i can recall in on percent move in the price. now back above $42 per barrel. i believe it is the biggest move in three years. indexthe commodity

climbing nearly 3% today, now let's take a look at some of the top stories we are following at this hour. the u.s. economy grew faster in the second quarter than previously estimated their gdp rose at an annual rate of 3.7%. the government passes first estimate last month was 2.3%. bigger gains in consumer and business spending. a record increase in inventories may be a sign that strong growth will be tough to sustain, at least in the short run. the u.s. has hit a five-week high according to the bloomberg confidence index. a note of caution, the poll was conducted before this week's volatile stock market. mark: claims for jobless benefits fell to a low. weekly claims have stayed below 300,000, the level economists

say is consistent with an improving labor market. of greecee president has appointed the head of the court as the country has moved one step closer to an early election. country's's first female prime minister. the head of a breakaway left-wing party failed to find coalition partners to form a government. it is looking like elections will be held in less than a month on september 20. stocks ended their five-day punch, the biggest since 1996 cancel close with almost all of the gains in the last 45 mins of trading. the composite was up more than 3%, and the shanghai composite gained 5%. we spoke with mohammed earlier, a bloomberg view economist and chief economic advisor. >> finances very different. like we did with housing 10 years ago, they created a bubble in the stock market. they believe greater ownership of shares was a good thing in

terms of that transition and it went too far. side, they have doubles and the various places that they will have to find a way to deal with it, and they will do so. the chinese government intervened today to boost. a big parade september 3 marking the 70th anniversary of the end of world war ii. olivia: police say at least four people have been killed since tropical storm erika hit the caribbean island. it is also bringing heavy rain to the island. airports are closed. they do not know yet if it will reach hurricane strength. apple issued invitations to an event november 9 in san francisco. hint, reason us a invitation to the event which will be held at the civic auditorium.

those are your top stories this hour. olivia: u.s. stocks are on track and there is a news that the year -- the u.s. economy grew more. mark: 233 billions in mutual funds assets managed. always good to see you. i have to ask you because every one gets a chance to watch what is happening this week. how would you sum up what is happening in global markets? is taking volatility to a new level. it is a reminder that volatility loss unless you sell. some of the prices we saw a relative to what we are seeing now, the takeaway really for long-term investors needs to be, don't overreact when we get panicky moments. olivia: we have seen a lot

suggest the fed will raise rates in september because of market visibility. we get a 3.7% growth, putting september back on the table? >> we do not think so. deadly came out yesterday in his press, they made it clear given everything going on with global growth concerns, that there is less urgency to move. in a way, the volatility we are to become the markets because it reduces the odds of a policy missed it. part of the problem for u.s. equities are global equities, there is also uncertain that will move forward with tightening at a time when cannot handle it. i think volatility has taken the september hike off the table. positivess -- probably

for risk assets. mark: u.s. exports for china are barely over 1%. >> the chinese economic impact is a little wider than trades with that one country. olivia: how do you evaluate that? how correlated are equities to what is happening in china? >> overall, i think people are realizing, and it is one of the things driving the rally, that it is a bit of an overreaction. china represents about 10% of u.s. exports. the numbers a over 1% gdp. i do not think there is much connection at all between the chinese economy and the stock market. certainly was happening in the economy is relevant. the print we saw last week was clearly disappointing here clearly, chinese economy is growing less quickly than markets have thought here it given what we have seen, think a lot of that is already

discounted we do nothing china world intoeveloped the u.s. recession pair with that in mind, there are a lot of great line opportunities in the market a couple of days ago. mark: we will get to that a moment. you mentioned what is about to take place beginning tomorrow. what are policymakers thinking and what are they hang behind closed doors,'s cynically about this week, but then going earlier this month to the 11th 20 chinese moved on their currency? classic and they're having a similar discussion to what we are about, the recent downgrading really justifies them putting their plans on hold. even though the economic impact is not likely to be that big in terms of the u.s. economic outlook, the financial market impact was clearly significant. when you weigh it all out, and i should mention we were pretty dovish for a while, take that for what you will.

i think we are even more confident will move gradually. off ther is probably table with that come our best bet at this point is the first hike does not happen until next year. we think if you take september off the table, he reduce the other they moved in september. olivia: because the market is a little less liquid, that kind of thing? >> we think some of the weaker impulses coming are likely to probably play out to the end of the year. we do not think that means recession or anything to dire, but we do not think momentum is likely to get better between september and november. likely to get better next year. mark: you had it about the psychology and not getting too emotional and things start getting on the roller coaster. what is oppenheimer looking at? >> we have seen a lot of opportunities because we have seen so much correlation. down, europeets go and japan, everything has gone down.

we think there is opportunity across the spectrum. europe was interesting because we still have the monetary europe, wert and in still have the opportunity for economic improvement. in the u.s., i think it is harder to make the case that we go from 2% growth to three to , there ispe's growth still room for improvement parity or is probably one of our favorite areas as we go around the world. as the rally has been in the u.s., the selloff has been even stronger in europe. the end of the day up 5%, today up more than five cent yesterday. a lot of people say it is not working. ourhe way you judge qe from perspective, that is where qe has a strong track record in the u.s., list asset price is. we are not looking for qe to

take europe to another huge level of growth. it is more, we think it will stem deflation fears and be good for asset prices. olivia: do you think it is worth the stock -- >> it is easy to just that in a snapshot in time. figure was double and we are confident in a couple of months, it is a better looking number. olivia: thank you very much for your time. thank you. , stocks arehere well into the green today up we will see of the rally can hold in the last two hours of trading. ♪

mark: the east river on this

thursday where we are seeing a snap back in the market yesterday the dow up over 600. the day is rising showing more strength after this this week. olivia: clearly a big v-shaped. a huge move. up 9% so far. mark: julie, good afternoon. julie: an incredible couple of days after incredible weeks that we have had. they have been pretty stable, at least thus far today. rate of change. we have not in alignment a going all the way back to thousand nine.

the largest gain in the nasdaq since 2009. dow since 2008, 1 of the many superlatives today with , 46% above the 100 day average. encouraging an update was relatively robust going. it was request on the downside. we talk about snapping back today, we're seeing them come back today. were seeinghen we the rally appears some of the worst performance among the commodities. really in the s&p 500. call miners have been clobbered. they have all been some of the worst performers this year. take a look at how they are doing today. it is incredible. 15 of -- 15.5%.

biggest one-day gain ever in this stock. again on the back of steep declines we have seen, also announcing some production and cost cuts. cold is still trending lower. gold has not seen the snap back, as we are seeing the risk on trade come back in. copper is back. is certainly back up 10% and trading at 4259. $40 per barrel in the rearview mirror at least for today with this map back we seeing. the companies that trans with the commodities are also doing well today. valuation.cause of analysts say, not justified given the outlook. these companies transport a lot of coal. the dow jones average up to .25% having it biggest change in

about four years or so. the gains we are seeing across the board are substantial. olivia: thank you, julie. mark: let's look at the top stories we're following this hour. the real risk now is deflation. the mutual fund giant is urging investors to buy high quality bonds. one gauge of inflation expectation has reached a five-year low. the bloomberg commodity index has fallen to its lowest level since 1999. olivia: denying a report is repairing an offer for st. jude medical that would devalue devices at $25 billion. cardare denying a report -- the report came from the financial times saying it was varied a $19.5 billion as of when they's's close. they have been working with banks for several weeks to

prepare cash and stock offerings for people familiar with the matter. it says advisors may include morgan chase and citigroup. mark: walmart is giving customers a head start on holiday shopping, with its annual holiday layaway program to his earlier than last year. customers can put their items on hold starting friday. each item must cost $10 or more in all items held must be a total of $50. 90 days instead of the 60 days they were given last year. top stories at this hour. olivia: one deck -- one decades since hurricane katrina devastated new orleans spirit we go live to new orleans and our colleague after the break. ♪

mark: this weekend marks the 10 year anniversary of hurricane katrina. an estimated 1800 people died

and tens of thousands were left homeless. olivia: one of the casualties was norlin's biggest hospital and now almost a decade later, his replacement has finally opened. we have a look. the university medical center in new orleans is a giant facility, designed to be welcoming. a $1.1 billion budget went toward buying art. there is a sculpture on the first floor. space for thehas patients to go outside and reflect and relax. helped design this hospital. katrinafeet higher than flood levels. chief medical officer and perhaps his proudest tour guide. while dr. w seems happy to shake

hands, he spent his career in new orleans as an er doctor. >> this is a major trauma room. within five minutes, the decision can be made whether to go immediately to the operating room. ,he next center is in houston will be in jackson mississippi. >> the new medical center is positioned to compete with hospitals in the city that he hopes will attract patients across the south. the new university medical center involves 2 million square stark contrast to this, charity hospital. it flooded during hurricane katrina, which closed several days after and it never reopened. a regional not powerhouse. was a public hospital founded in the 18th century. dr. w disagrees with critics who say the medical center is a run as a public drive it partnership

and cannot be the same kind of safety net for people who call the city home. >> the hospital never walked away from its mission and that mission is to care for all patients. >> federal funds went a long way toward paying for the facility. the reality, he says, there will be a lot less government money and it needs to do a better job than his predecessor. mark: our colleague joins us live from norlin outside the lowest death lower ninth. is it for important the city of new orleans to have the hospital open? >> hugely for two reasons. as we said in that piece, the hospital close just a couple days after hurricane katrina. doctors removing through five temporary hospital for this one was open. there was a decade long time where they did not have a place

to work here for another reason, the city is trying very hard to attend -- attract a lot of file to knowledge in the city. tourism andent on they're making a conscious effort to track biotechnology. thinking is, built the big hospital and the veterans hospital next to it and that will give rise to a lot of companies that will do work alongside the two hospitals. >> how successful has new orleans in? >> this is a city that is what very hard. they have some of the best tax incentives in the united states. in thes been happening film industry and biotech. you see places where you could andtart a small business you have a systems getting your business up and running. the dream here is for by this to to get running around the hospital. the first hospital open, the hospital still under

construction. they are saying they hope in the next few years, they will see more around there. mark: we saw your interview earlier today. how has he been in attracting biotech? does he have to go to them? >> i was struck by how often he travels. he was on a plane a lot going to new york and tried to get companies there. he is on the road evangelizing for the city. i presume he will be there when the president speaks in about an hour or two. they continue to live here in new orleans after katrina. he is taking a walk throughout the neighborhood. a population is reduced by 20% between then and now. it had a big public housing structure that was just a mild -- just demolished 30 is that it come back soon and deliver a speech here at about 4:00 local time. 5:00 your time. olivia: do you have any idea what it includes?

classes has got to does press to it here one is to memorials -- >> it has got two parts. one is to memorialize what happened. ,ow people have come since then you have seen rate reductions in crime and you can expect president obama will stress those points in that speech in a couple of hours. mark: david joining us live in new orleans. obama will bet making remarks in just a couple of hours. what is coming up next? olivia: i'm said to see you go. we will search for answers as kansas city hosts is anyone treat against the backdrop's of a volatile market. up all night, he met the fed president. ♪

♪ ♪ ♪ get excited for the 1989 world tour with exclusive behind the scenes footage, all of taylor swift's music videos, interviews, and more. xfinity is the destination for all things taylor swift. olivia: let's go straight to the stories making news at this hour. a setback for the ceo bill foods.

professionals have been ordered to pay $148 million in a takeover suit. there were allegations they drove down the value of dull so murdoch could take it private. spoke a shortmp time ago in a rally in south carolina. topic number one was his hair. do not wear a to pay. it is my hair. i swear. is it mine? >> yes, i believe it is. mr. trump: thank you. olivia: trump's momentum shows no signs of slowing down. polls find he is now the choice of 28 percent of republicans nationally, up from 20% in the prior poll. another side of momentum in the housing market today your pending home sales rose. sales are up one half of 1%.

it is helping the real estate market as well. average long-term u.s. mortgage rates drop this week to the lowest levels in some a. freddie mac says the average rate on a 30 year fixed-rate mortgage fell the .48% from 4.93%. the benchmark rate has not been as well since may 21. the rate on a 15 year fixed -- from 3.1 5% are those are your top stories at this hour. coming up in the next half hour won't, the weather patterns sweeping the globe for the first times in five years, setting off the next great search and oil food prices. plus, pop in a microwave and you're good to go. we talk about how these new gems are changing the $80 billion industry. and for ari is going public. we will talk about business strategy and why it wants an ideal now.

all that and much more is coming out in the next hour. what a wild ride it has been for global market this past week. for vicks, more than 50%, it broke through 51 points. no one is certain exactly what the cause was. some say maybe it was the fed. those people include jim grant, the founder of -- i spoke to him earlier this morning on bloomberg television. priceual mandate stability and full employment. the fed positive functional mandate is that of arsonist and firemen. intended, but somewhat maladroit actions to manage and manipulate, the fed creates those congestions -- conditions that lead to financial turmoil. as soon as smoke begins rising from the marketplace, you hear

the climbing of fire trucks and they wheel up breathless and -- breathless and say, we are here and we will fix the fire we started. one should not dogma ties, as i have just done. the fed is not 100% responsible for every action under the sun. the fed as constituted is a new institution in our financial lives. it is omnipresent if not omniscient. olivia: i'm glad you mentioned bill dudley. we had a press conference from the fed yesterday here he was adamant that all the stability we have seen this past week -- have a listen. is very different from the financial crisis, the financial crisis was very much about us. ofurities, securitization securities that turned out to be highly toxic. that was about us. this is not about us.

>> i think one ought to tread more humbly with respect to comparisons. the fed was not exactly the last set of people to understand what 2008 was all about. they were near the last in line to get it. of what no conception was happening before or during the events. in little less quick to draw that analogy. this is meant to be globally incurred -- interconnected world. that is the permanently echoing cliche and there is an element of truth to it. we are one, especially one my opinion the wrong idea, that we must have 2% measured inflation, that we must manipulate interest rates rather than allow -- we must manage markets upward to create asset

values that will stimulate spending. that is the mantra from central bankers and that is a worldwide idea, the wrong idea. these ideas, if ideas were ever important in finance, and the ideas are made in america. olivia: supporters will say they will help, market, perhaps leaving little room for employment. markets will get a new set of speculation on what conceivably might cause them to act as if they do not act now, when? year,o not act last right? so when will they act? this will introduce more uncertainty, if possible.

>> fed funds futures rate -- >> they said september last rate -- last week. olivia: what are you listening for from jackson hole? i am listening for the sound of the vice-chairman of the fes about some thing inflation. this is really interesting. what they want, what they say is a 2% per year in evaluation and the purchasing power of the dollar. why do they say that? who wants that? it is not part of the fed mandate. it is not something congress gave. it is something congress gave itself. that is something from the ever -- ever fertile brains.

the idea of a 2% inflation target, an american idea in new zealand as well. dogma,he world's new except, when you think about it, you're puzzled why it should be so. is that inherently a good thing? to answer, no, it is not. olivia: fellows jim grant both arsonistd is and firemen. that is doing time i've ever seen him not wearing a bow tie. coming up, much more, including microwaved stones might be a girl posse's best friend. we will talk about how the man-made gem industry to animate the $80 million market is next. ♪

olivia: welcome back. it is muggy, a late summer day here in new york city. you're looking at the view from global headquarters here in manhattan. a look at how commodity prices are settling in your trading. i have to bring in alix steel, our resident expert. at oile have to look today, and unbelievable move. it rallied the most since 2009, a six-year high. the question is, why? second -- second quarter gdp. >> there was no fundamental technical move for this are all

in all, let's look at fundamentals. gasoline inventories actually rose, the sum or everyone is driving, so it does not bode where refinersll stop buying a lot of crude. .lso, you had at they need to actually slip below three dollars for output to start falling. it is still 8% higher than a year ago, below 30. nothing changed, which made the move. $38. seriously, we would have thought $30 is crazy. but i'm very comfortable. i never know what i'm talking about, but i really do not know what i am talking about. >> the market needs that. these types of moves need to be

wased on technical that really contributing. inthe rot -- the wild ride equity markets. the risk we saw a earlier this .eek that you would have seen that did not happen. is off again today. >> measuring stock volatility with gold volatility, they are each other since 2013. gold should not be moving like a vexed. it should not have high volatility. it is contributing to this kind of slider you would have thought something very different. i brought this up the other day as well. struggling, you would need china to buy gold to help support the market as well as in india.

>> you're talking about regional buyers. >> right. that is not nothing. 2000 ties for both of them, india and -- and china. they are dealing with stocks selloff, with what kind of hit that is taking for your own personal welfare. >> there is a cracked on consumption. >> that is a -- that is a real thing. >> the bloomberg commodity index is getting completely hammered. rebound". will the correlation we have or will they diverge, meeting -- meaning will devaluation stocks wind up? i will be back tomorrow.

food prices are new today. alix: here is the deal. this could mean the weather patterns go crazy. worldwide androps winds up affecting crude prices. look out for that, to hit records for 2008 and 2000 -- the reason why it is important, you might not have enough supply that might cause the government having to step in. that is one of the biggest risks in the second half of the year. death something to keep on your radar. olivia: that is a frightening selloff because of the

and commodities because of the high food import bill. alix: they already struggling for some and he reasons not the least of which is that oil is down. >> they have got 440 million population are we will go back to commodity. i will talk about diamonds. stick with me as we segue to the diamonds store. manufactured diamonds today, it looks like they are climbing in value thanks to improvements in the way things are grown. this is a real thing. there is rising consumer demand particularly from younger americans. that means it could quickly tumble. soanya, this is a cool story out today. manufactured diamonds, is that real? >> do you have a geologist? [laughter]

>> let's not ask you that question. if you wind up having man-made diamonds versus the real shiny stuff. >> they are very shiny. to dining minas. >> they account for each of the biggest mining company -- companies. >> prices overall have been falling, the value of diamonds actually dropped 2.5% in july, down 14% in the year. -- are seeing too much this too much supply and not enough demand.

>> that is interesting, the other commodities, typically for industrial use. diamonds. down to the consumption cracow we're seeing out of asia. who is buying these diamonds? any sense of where the demand is coming from? encroachment seen by the miners and the people selling the lab diamonds is, it comes who are goingl's away from diamonds to other luxury goods. like it it -- if it is your birthday, you will not get a piece of diamond jewelry. maybe we'll get a handbag or some other kind of luxury thing. for younger consumers who just have not been exposed to that intense marketing that everyone older than 25 or 30 saw from all of the marketing in the last 60 years. that tagline that they are now planning to bring back, diamonds

are forever. >> it is cheaper. i actually got to do this cool story. a half-hour special. i went down and we focused on the market campaign because that campaign, a diamond is forever, really put diamonds on the mat. they made it a tradition that you would give diamonds as an engagement ring. that was not always the case. now we are exporting that tradition to the emerging markets. it is interesting. plus, we were talking about the slowdown in demand for diamonds. it is fair to say there has been growing stigma. people are becoming a lot more conscious of where diamonds are come from. they are really trying to shine the responsibly sourced diamonds pretty see the line coming out so that each diamond has a little barcode etched into it. you can actually see, someone can scan into the source of the

diamond. >> fascinating. who knew? >> they look just like the real thing. >> really? i do not know, how would you feel if you got a fake diamond? alix: i probably would not know the difference. soanya our thanks to with bloomberg news. all right. now, a look at our top stories at this hour. we are not going to break. hollywood is finally getting a look at just to many people are stream videos on netflix. the ratings company nielsen has been ramping up a program that has feeling on netflix and other online services. nielsen is now tracking almost 1000 shows. mcdonald's and tyson foods have cut ties with a chicken supplier accused of animal cruelty or that is in response to video appearing show operators of -- clubbing birds to death. they provide a chicken for the chickend chain, mcnuggets.

paypal is raising prices on thousands of small businesses as it tries to maintain revenue growth. the company is introducing a flat rate of 2.9%. those transactions will come with a three point flat rate plus a fee that varies by country or paypal is now a stand-alone business, completing its split from ebay back in july. acebook is hoping to offer personal digital assistant that will run inside its mobile messaging app. in an earlier step toward matching things already offered by apple -- still to come, for aris are revving up for the ipo, which may include replacing a ceo who is retiring. we will tell you more next. ♪

olivia: for aris considering appointing the chairman as ceo in the coming months. the change could happen -- about why forke aris going public in the first place and what it means for the future of the automaker. invest.eds cash to a very high valuation for for art. he says it will be valued at at least 10 euros. are selling10% they now, worth more than one billion euros. that is the reason for an ipo now. what would an ipo, what would a spinoff for ferrari mean for fiat chrysler? debate.is something we

essentially, it is for two regions. fors giving the freedom ferrari to be independent. it means that if they find the right partner for a merger, we know they have been looking to merge with gm until now for sure, then, the family will not risk losing control over for our if they merge with another carmaker. marchionne expects they boost .he value before the spinoff 10% now, a high evaluation. owned in for 80% area the beginning of next year. after the ipo, ferrari would

finally get the value and after --gets real value, >> of course, marchionne already the ceo of fiat ricer as well as the chairman of ferrari, notorious for working around the clock. he apparently never sleeps. doesn't he already have too many jobs? busy. guy is a bit ferrari,hairman of which was spun off in 2011. chairman of the swiss company sgs. has a lot of jobs. he took charge of ferrari one over two decades. he already has the ferrari as one of his main jobs. involved it looks like he

really cares about ferrari and that is why he will get the job when they ask for the ceo to retire probably in the coming months. still ahead, much more, including we will go live for more of the world has his top economic minds. we will speak with the vice chairman of the fcic next. don't miss it. ♪

olivi: welcomea back to the bloomberg market day.

what happened to today's rally? the dow is up nearly 400 points. looks like we are up about 200 right now. alix: clearly unable to hold those levels at this time. the s&p and the nasdaq also the best today rally since 2009. olivia: it is hard to figure out what the catalyst is. the u.s. economy grew at a revised analyzed rate of 3.7%, which sounds huge. it is also perhaps the news that bloomberg was reporting that the chinese government actually did intervene in the stock market today, buying up some blue-chip stocks, the equivalent of their large-cap stocks. that is why we saw the chinese market actually rally for the last -- for the first time in the last six days. alix: